Bookseller, Korean firm strike deal to deliver co-branded kit

Bookselling giant Barnes & Noble is back in the tablet business – sort of – thanks to a new partnership with Samsung.

The company announced on Thursday that it will soon offer co-branded Samsung Galaxy Tab 4 Nook fondleslabs that come preloaded with custom software for reading e-books, magazines, and newspapers provided by Barnes & Noble.

The 7-inch tablets will be displayed and sold in Barnes & Noble retail stores alongside the company's current line of e-ink readers, of which the Nook GlowLight is the most recent.

Previously, the bookseller manufactured its own line of Nook HD tablets, but it jettisoned those efforts last June when it became clear that consumer electronics wasn't really its forte.

Nook tablets captured less than 2 per cent of the market during the 2012 holiday shopping season, and hardware sales had become a drain on Barnes & Noble's Nook division, which otherwise was seeing content sales grow.

For a while, some pundits speculated that Microsoft might take Nook off Barnes & Noble's hands. The software giant bankrolled the e-book biz to the tune of $300m in 2012 in a deal that gave Redmond a 17.5 per cent stake in Nook, and Redmond was once thought to be ready to snap up the whole thing for $1bn.

But the romance seemed to have cooled earlier this year, with Microsoft striking a new deal with Barnes & Noble that allowed the latter to cancel its efforts to develop Nook apps for Windows 8 and Windows Phone.

Barnes & Noble never said it was getting out of the fondleslab business, an area in which its archrival Amazon has found some success. Rather, it said it would pursue "a partnership model" future tablets, where another company would take on part of the risks of manufacturing.

Thursday's announcement appears to signal an even further retreat from that idea, with Barnes & Noble opting to now merely provide software for another vendor's existing kit.

The first Nook-branded Galaxy Tab 4 fondleslabs are expected to arrive in Barnes & Noble bookstores in early August. ®

Bootnote

In related news, Barnes & Noble also said on Thursday that its Nook division will vacate its current 208,000-square-foot headquarters in Palo Alto, California and move into new, 88,000-square-foot "state-of-the-art" facilities in nearby Santa Clara. Employees of the company's Barnes & Noble College digital education division, which shared the Palo Alto space, will move to a different location in Mountain View. In all, the moves are expected to reduce Barnes & Noble's annual occupancy expenses by $10m and reduce its future lease commitments by $102m.